Sales of Goods Act, 1930 - Introduction
Sale of goods act was part of Contract act which was deleted and was made a separate act. All the basic provisions of contract act apply to Sale of goods act. Sale of goods act deals with sale of movable property.
Movable property includes grass, standing crops, standing timber but does not include money and actionable claims.
As per to Section 4 of the Sale of Goods Act, 1930 "a contract of sale of goods is a contract whereby the seller transfers or agrees to transfer the property in goods to the buyer for a price"
Contract of Sale is both Executed and executor contract as its definition includes Sale (seller transfers) and agreement to sell (or agrees to transfer).
In agreement to sell ownership is to be transferred in future and in Sale ownership of the goods is immediately transferred.
ESSENTIALS FOR A VALID CONTRACT OF SALE
There must be two parties.
A person can not enter into any form of agreement or contract with himself. There must be two parties one selling the goods and other buying the goods to form an agreement to sell or sale.
Subject matter of sale must be 'GOODS'
Contract of Sale can be made only for goods. As per Sales of Goods Act, 1930 Goods is moveable items and it includes standing crops, Standing Grass and Standing Timber. However it does not include Actionable Claim and Money.
Consideration in Price
Consideration in a contract of sale must be in money. So, if the goods are offered in exchange of goods it will not amount to sale, but it will be BARTER. In case there is no return consideration neither in cash or kind, it is gift and cannot be considered as sale.
Consideration may be partially in money and partially in goods. As in Aldridge Vs. Johnson a person agreed to exchange with B 100 quarters of barley at 2 Pound per quarter for 52 bullocks at 6 Pound per bullock and pay the difference in cash. It was held that this was a contract of sale.
Transfer of Property in the goods
Property means the ownership or the rights over the goods. As per Section 2 (11) of the Sales of Goods Act, 1930 property in Contract of sale means the general property in the goods and not merely a special property.
Essential elements of a Valid Contract
All the elements of a valid contract like Lawful Proposal, Valid Acceptance, Lawful Consideration, Capacity of parties etc must be present in a contract of sale.
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